Of the many advantages granted to homeowners, one of the most popular is the list of tax breaks they receive. As a new homeowner, you may be able to deduct some of the costs related to your purchase if you itemize your deductions rather than use the standard deduction when filing your taxes. These costs can include mortgage interest, real estate taxes and private mortgage insurance premiums you've paid.

While the IRS can best explain what you can and cannot deduct, your Realtor can answer your initial questions about tax incentives during your home buying process. Here's a closer look at some of the deductions that might apply to your situation.

If you took out a loan to purchase your home, you may be able to deduct from your taxable income the amount you paid in interest on your mortgage. This mortgage-interest deduction especially is valuable for new homeowners since the majority of your monthly mortgage payment will go toward paying the interest on your loan for the first few years. Your lender will send you a Form 1098 that lists how much you paid in interest.

Real estate taxes

If you paid real estate taxes assessed on your property to a local or state taxing authority such as a water district, city, county or school district, you may be able to deduct this cost. This information will also be on the Form 1098 from your lender.

If you made a down payment of less than 20 percent of the purchase price on your home, you are probably paying private mortgage insurance. But you may be able to deduct some of the money you paid for these PMI premiums, if you meet certain qualifications. This amount will be listed on the Form 1098 from your lender.

Keeping accurate records is important for properly reporting your deductions as a homeowner. The IRS recommends keeping your purchase contract and settlement papers and any paperwork such as receipts or canceled checks. Staying organized will save time when you sit down to file your taxes, and it's good to keep your paperwork handy in case you're audited.

Remember everyone's situation is different, so the best way to determine what will apply to you is by consulting a tax professional who can help you find out what items are deductible.